Italy government party wants slower austerity

May 07, 2012|Reuters

* Party economic spokesman calls for delay approving fiscalcompact

* Says Italy austerity has been "mistaken", imposed byGermany

* Attacks ECB, calls for Europe-wide policy shift

ROME, May 7 (Reuters) - Italy should respond to FrancoisHollande's victory in France's presidential election by easingausterity, raising deficit goals and delaying approval of new EUrules on public finances, the economic spokesman for a majorruling party said on Monday.

Stefano Fassina, economic spokesman for the centre-left PD,one of the two parties which technocrat Prime Minister MarioMonti depends on for his majority, told La Stampa daily thatHollande's victory marked an opportunity for Italy to end"mistaken economic policy choices".

Monti should now "delay parliamentary approval of the EUfiscal compact (on tougher budgetary rules) and at the same timeslow the process towards deficit reduction", Fassina said,calling for a sharp increase in public investment.

Hollande has pledge to swing policy away from simpleausterity to growth. More than half the vote in Greece inSunday's election also went to anti-austerity parties.

Only last month, Monti delayed by one year the goal ofbalancing the budget in 2013 which his predecessor SilvioBerlusconi agreed with Italy's partners last summer.

Fassina, one of the more leftist members of the PD, isresponsible for the party's official line on economic policy,though his views may not be shared by some of the party's morecentrist members.

Hollande's victory marked "a defeat for the blind austerityadvocated by the European Central Bank which is draggingeveryone down, and so we must go in the opposite direction, theone that can save us from a shipwreck," Fassina said.

The PD forced Monti to compromise on his original labourmarket reform proposal which is still before parliament,insisting that he modify a plan to ease firing restrictions.

Monti, however, has been among the forefront ofEuropean leaders saying that growth policies much not beforgotten in the drive for austerity.